Five trillion increased indebtedness heads for the US

As this blog forewarned last March, here, the next Tsunami to crash against the West's economies will come with the quaint sounding names of Fannie Mae and Freddie Mac. These 'government backed'/ 'not really government backed' financial institutions holding trillions of the lower income mortgage debt of the US housing market typify the kind of murky financial practises that have now brought us to the brink of Phase II of the credit crunch. As I blogged earlier this month, here, only a restoration in the belief in the dollar can supply relief - summed up - that means "sound money" folks! Read Fannie and Freddie hit the skids from the Wall Street Journal Blogs, here. UPDATE on 22/8/08 View this interview on YouTube from Bloomberg with Harvard's Marty Feldstein from Jackson Hole, here.

FT reports mortgage misery.

The Financial Times article, linked here, opens as follows: More than a fifth of UK homebuyers who have a chequered credit history have fallen behind on their mortgage payments and even those with top-quality ratings have seen a statistically significant rise in delinquencies in the first three months of this year.